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Cannabis Summary for Oct. 8, 2019

2019-10-08 20:20 ET - Market Summary

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by Stockwatch Business Reporter

United States cannabis retailer Medmen Enterprises Inc. (MMEN) dropped 32 cents to $1.97 on 1.68 million shares after announcing the termination of its $682-million deal to acquire PharmaCann LLC. That deal, which was going to be a dilutive, all-stock transaction, was announced last year in October. Medmen co-founder and chief executive officer Adam Bierman said that the company would try to "deepen, rather than widen, (the) company's reach." Mr. Bierman's odd lurch into management-speak means the company will focus on California, where it has most of its dispensaries now. He did not mention Florida, where Medmen planned to have 14 operating dispensaries by the end of 2019 (the company currently has four). The acquisition of PharmaCann would have spread the presence of Medmen's dispensaries to Massachusetts, Maryland, Mississippi, Ohio and Pennsylvania.

In connection with the termination of the deal, PharmaCann has agreed to transfer an operating cultivation and production operation in Illinois, a retail dispensary in Illinois, a retail licence for Greater Chicago, Ill., and a licence for a seed-to-sale facility in Virginia. Medmen, perhaps thinking it sounded impressive, boasted in its news release today that it will now hold one of "only" 213 cultivation and production licences in Illinois. Conditional to the transfer of these assets, Medmen will forgive the $21-million (U.S.) owed to it from PharmaCann's line of credit.

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